Lorck port plan to ensure public ownership

Napier Port needs expansion but to finance it local politicians fear a stake may be sold to private interests. Photo/File

if a stake in Napier Port was to be sold then lines company Unison Networks should be the company to buy it, says Tukituki Labour candidate Anna Lorck.

Napier Port needs expansion as cargo volumes continue to break records due to increasing export and extra cargo due to Wellington's earthquake-damaged port.

Napier Port could finance a $100million expansion itself through a combination of port revenues and debt but Napier Port directors are obliged to consider all options to pay for the expansion when writing a business case.

A resource consent application has not yet been made but if granted the business case would be presented to the port's owner, the Hawke's Bay Regional Investment Company which is owned by the Hawke's Bay Regional Council.

If the port self-funds then the port's dividend to the Regional Council would likely be slashed, possibly placing pressure on ratepayers.

The port paid a dividend of $7.9 million to the Regional Council from a profit of $11.5m for the year to the end of September. The Regional Council's operating revenue to the end of June was $42.3m.

"If we have to sell a sell a stake in the port then selling it to Unison could be an appropriate investor," Ms Lorck said.

"It is owned by electricity consumers in Napier and Hastings so the port would remain in public hands.

Unison owns the electricity distribution networks for Napier, Hastings, Rotorua and Taupo but about 10 per cent of its profit comes from subsidiary companies Unison Fibre, Unison Contracting Services, Unison Insurance and transformer manufacturing business ETEL.

ETEL was purchased in 2009 and last year ETEL purchased an Indonesian transformer manufacturing business, opening up lucrative supply contracts to the world's fourth-most populated nation and opening up markets for Unison's Smart Grid innovations.

Unison Networks is owned by the Hawke's Bay Power Consumers Trust which has elected trustees.

Trust chairman John Newland said full consultation with consumers and a clear mandate would be needed before such an investment could be made.

He wouldn't rule out such a purchase by the trust or Unison but said it would be unlikely.
"It would be a change of direction for the trust," he said.

"We are elected with a mandate to provide network distribution and dividends, so in my view we would have to go back to consumers because that it is way outside the mandate we have and company strategy."

Unison chairman Kevin Atkinson said it was an idea worth considering to ensure ownership remained in Hawke's Bay community ownership "but it would gobble up any headroom we have on our balance sheet".

Unison chief executive Ken Sutherland was involved with the corporatisation of the Wellington's port before entering the electricity sector.

Napier MP Stuart Nash said the port should not be sold, especially because it looked to become increasingly lucrative.

"I have the utmost respect and admiration for Unison but there aren't the protections in place to make sure it would not be sold out of community hands."

Ms Lorck said protections would be a prerquisite for any partial sale of trhe port.

"We certainly don't want to find ourselves in the same predicament that we did with Richmond Meat Company where we lost complete control and the company went to our competitor. This has to be about local ownership.

"We need to power up our Port. It is in our region's best interests to ensure it has the investment to expand and capitalise on new development to grow and prosper for all of us in Hawke's Bay.

"It must remain in the ownership of Hawke's Bay - that must be our priority."